Apple may be a computer manufacturer, but they primarily sell expectations. Apple's designs set the standard by which all other manufacturers are judged. They set the high water mark that consumers use when they open their wallets. The process starts with a rethinking of accepted design patterns and ends with all other competitors scrambling to keep up.

This is what they do best. They take over the mind share of consumers and define the norm. That's why every computer in every movie or TV show is a MacBook. That's why every smart phone in every TV show is an iPhone.1 It's why an iPad is now synonymous with tablet computers even though they existed almost 10 years before the iPad.

By the time Dell, Sony, and HP began making aluminum laptop chassis, Apple already owned their own custom manufacturing and recycling process. By the time Dell, HP, and Microsoft began to make flash based MP3 players, Apple had already secured the majority of the supply. And, while HTC, Samsung, and Blackberry were trying to copy the first generation iPhone, Apple secured a copious supply of the resistive LCD screens and Gorilla Glass.

This is how Apple beats their competitors. They don't just make nice products for people that like Apple designs. They change expectations and then own every part of the process to fulfill the expectations. Just when Apple designs become the standard, they raise the bar and add a Retina display to their laptops. In two years, high density displays will be the new standard. Everyone else will be struggling to secure their supply chain while Apple is busy setting the next expectation.